The decline in the industry became noticeable as from 1994. The industry cried out to the government because it identified the causes as:

• Unstable political situation

• Low purchasing power of the populace

• Massive smuggling

• High cost of production due to poor infrastructure

• High exchange rate

• High interest rate

• Various taxes and levies (Federal, States and Local government)

The situation became more complicated, when in January, 1997 the ban on the importation of textiles was lifted. The industry cried to the government, stating the possible consequences of that singular act. The consequences are well known to everybody today. Within 6 years not less than 50 companies closed down and about 80,000 employees lost their jobs, about 60% capacity utilization in 1996 deteriorated to about 28% as at 2002.